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Schwarzenegger moves to implement health insurance rate review

July 7, 2010 | 7:22
pm

Gov. Arnold Schwarzenegger moved Wednesday to implement a major element of the new national healthcare overhaul, seeking a $1-million federal grant to strengthen the state’s review of health insurance rates.

Much of the money would pay for actuaries to evaluate premium hikes sought by insurers. Schwarzenegger also wants insurance companies' planned increases to be posted on their websites and on the websites of state regulators.

The healthcare law requires states and the federal government to establish a process to review “unreasonable” rate increases. The definition of "unreasonable" is still being developed, but the law provides grants to states to begin the evaluations. The grants will be announced in August.

“The state’s proposal will provide greater consumer protections by requiring all premium filings to be reviewed and certified by an independent actuary to ensure premium costs are accurately calculated,” the governor’s office said in a statement.

Some of Schwarzenegger’s proposals require approval by the Legislature, which is considering bills that would give regulators new authority to reject premiums.

The California Assn. of Health Plans could not be reached for comment.

Two of California’s largest health insurers -- Anthem Blue Cross and Aetna Inc. -- have come under criticism for filing rate hikes that contained errors. Both insurers withdrew their applications after an outside actuary found the mistakes. Both resubmitted their filings last week.